Newark councilwoman, Baraka clash over hospital's tax-exempt status

By Dan Ivers | NJ Advance Media for NJ.com
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on November 19, 2015

Newark Mayor Ras Baraka (left) and Central Ward Councilwoman Gayle Chaneyfield Jenkins (right).

 

NEWARK – Morristown's high-profile tax settlement with Morristown Medical Center parent Atlantic Health has sparked a war of words over whether Newark should examine the non-profit status of hospitals operating within its borders.

Earlier this week, Central Ward Councilwoman Gayle Chaneyfield Jenkins repeated an earlier call to convene a special Municipal Council task force to review the tax-exempt status of Barnabas Health, which runs Newark Beth Israel Medical Center in the city's South Ward, in light of the Morristown decision.

"With our residents facing a 9 percent tax hike this year and the city struggling with a structural deficit, it would be irresponsible for the City Council not to explore ways to raise additional tax revenue," she said.

The call comes over the objections of Mayor Ras Baraka, who had previously issued a statement calling Chaneyfield's suggestion "premature and unnecessary."

He contended that his administration is set to meet with Beth Israel representatives to present ideas on how to generate tax revenue, and that the recent purchase of St. Michael's Medical Center by for-profit Prime Healthcare Services is likely to prove a major boon to the city's tax rolls.

"My administration appreciates the councilwoman's passion and zeal on this issue. As we move forward, we welcome her recommendations to protect our residents and ensure that our city receives its fair share of taxes," he said at the time.

Chaneyfield, however, said she was prepared to press on with the proposed task force, and urged her colleagues on the executive board to follow suit.

Should they heed her advice, the task force would examine how much of the Beth Israel campus could be considered a taxable, for-profit operation.

Last week's ruling in the Morristown case ordered Morristown Medical Center's parent company, Atlantic Health System, owed the town for 24 percent of its property. The outfit was ordered to pay the $15.5 million in back taxes over 10 years, and is expected to pay approximately $1 million per year moving forward.

In a statement, Barnabas CEO Barry Ostrowsky said he believed all tax-exempt medical facilities that use local services should make a fair share of contributions to their communities.

"It must be kept in mind, however, that our facilities are all major economic engines in these communities through employment, significant vendor support, and substantial community benefit," he said.

The call is not the first time the outspoken Chaneyfield has led a charge against the West Orange based healthcare company. She was an outspoken opponent of its attempted acquisition of Saint Michael's, both before and after the hospital entered bankruptcy protection earlier this year.

She has also periodically found herself at odds with Baraka and his administration over issues including the council's lack of invitation to closed-door meetings and announcements during President Barack Obama's visit to the city earlier this month.

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